Why plan your budget early?

The upcoming budget season presents a huge opportunity for partnership professionals to secure the necessary funding for long-term growth and scalability in 2025. Waiting until the last minute can limit your ability to capitalise on key investments that could drive transformative change (to be honest, waiting until the last minute can also lead to sales and marketing getting more of a pie to drive their activities, leaving partner teams with the leftover).

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The Power of an Ecosystem Model

An ecosystem model, characterised by strategic alliances and collaborations, offers numerous benefits. By leveraging the strengths of partner organisations, companies can:

• Enter new geographies and customer segments
• Access complementary technologies
• Offer a broader range of solutions and services
• Associate with trusted partners
• Increase innovation and expertise from partnerships

Securing Budget for Your Ecosystem Vision

To effectively pitch your ecosystem model and secure the necessary budget, consider the following strategies:

• Speak ROI - Demonstrate the tangible financial benefits of your partnerships initiatives, including increased revenue, reduced costs, and improved customer satisfaction.
• Emphasise how your partnership's strategy aligns with the company's overall business objectives and growth plans.
• Share examples of past partnerships that have delivered significant value and demonstrate your team's ability to execute effectively.
• Create a well-structured presentation that clearly articulates your vision, outlines your proposed investments, and highlights the expected outcomes.

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Here are top 3 tips on how to secure partnerships budget in 2025:

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1. Prove your partnership's worth

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To effectively demonstrate the revenue potential of your partnerships initiatives, it's essential to quantify the expected ROI. This involves calculating the anticipated increase in sales, cost savings, and other financial benefits. For example, if your partner has a large customer base that aligns with your target market, you can estimate the potential revenue generated from cross-selling opportunities. 

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Additionally, sharing success stories from previous partnerships can provide compelling evidence of the revenue-driving capabilities of these collaborations. When your ecosystem is still in its early stages, it's essential to focus on demonstrating the potential for future growth and value creation. For instance, articulate the potential synergies and benefits that will result from the partnership, such as increased market reach or accelerated product development. Other ideas include explaining how your partnership will lead to improved product features or services that directly benefit customers (this can include integrations with software providers to add additional value to your native product and as a result increase the potential prospect pool for your joint offering).

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The most important aspect of building a compelling case for your management team is to present how the ecosystem investments drive the actual business outcomes. Keep in mind that most executives are focused on numbers and any budget requests must be reflected metrics your initiatives will drive. It is suggested to focus on emphasising these metrics:

• ARR (Annual Recurring Revenue): Highlight how new integrations have boosted renewals and LTVs.
• Win Rates and Deal Sizes: Present data showing that co-selling with partners improves win rates and deal sizes, directly impacting sales performance.
• Customer Retention and NRR (Net Revenue Retention): Explain how partnerships and integrations reduce churn and improve retention, leading to stronger NRR. For example, showcase how a new integration increases product stickiness and customer satisfaction.

If you're looking for a cheat sheet for the key metrics to track your ecosystem health, make sure to check out this article.

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When requesting a budget, it's important to articulate the nature of the change you're proposing.

• Incremental changes are typically smaller-scale adjustments that aim to improve existing processes or products. These might involve funding for new tools, for example, PRM software or additional headcount.
• Transformational changes, on the other hand, represent a more significant shift in strategy or operations. This could involve a fundamental shift towards an ecosystem business model, where your company partners with other organisations to create a broader, more interconnected value proposition. For example, forming alliances with different types of partnerships to expand the range of offerings

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Pro tips for:

Early ecosystems: Request a budget to run pilot programs or small-scale initiatives to share the positive results and learnings from these experiences.

Scale-ups and mature ecosystems:  Focus on showcasing the partner success stories - how you leverage partnerships to drive sales and less tangible KPIs (e.g. brand awareness).

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2. Highlight contributions

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When crafting a partnership proposal, it's crucial to ensure it aligns seamlessly with the company's overarching strategic goals. This alignment demonstrates that your proposed partnership is not just a random idea but a strategic move that will contribute meaningfully to the company's success. For instance, let's consider a hypothetical scenario where a B2B software company aims to expand its market share in a specific industry. To achieve this goal, the company could partner with a consulting firm that specialises in that industry. By combining the software company's technological expertise with the consulting firm's industry knowledge, they can offer a more comprehensive and valuable solution to their target market.

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Another example is a retail company seeking to enhance its customer experience. They might partner with a delivery service provider that offers same-day or next-day delivery options. This partnership would directly address a key customer need, increasing customer satisfaction and loyalty. In the realm of e-commerce, a marketplace platform could partner with a logistics company to offer efficient and reliable shipping services. This would improve the overall customer experience and attract more sellers to the platform.

Furthermore, in the financial services industry, a bank could partner with a fintech startup to offer innovative digital banking services. This would help the bank stay competitive in a rapidly evolving market and meet the changing needs of its customers. By identifying areas where a partnership can add value, you can create a compelling proposal that resonates with decision-makers.

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Pro tips for:

Early Ecosystems: Present a proof of concept that showcases the potential benefits of your partnership model. This could involve a joint product development or a successful customer implementation. For instance, a software company might demonstrate how a partnership with a consulting firm resulted in a new product feature that met a specific customer need.

Scale-ups and Mature Ecosystems: Quantify the revenue growth driven by partnerships. For example, a SaaS company could highlight how partnerships contributed to a 20% increase in annual recurring revenue. Furthermore, showcase how partnerships have enhanced brand visibility and recognition. This could involve increased social media mentions, press coverage, or industry awards.

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3. Focus on building internal relationships

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While external partnerships often take centre stage, the importance of cultivating strong internal relationships cannot be overstated. Building a network of internal advocates is crucial for the success of any partnership program. These individuals can champion your initiatives and help overcome potential obstacles.

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One underrated tip is to focus on building relationships with key stakeholders within the organisation. Gain their trust by demonstrating your commitment to the partnership. This can be achieved through regular communication and proactively addressing their concerns, for example during cross-company meetings, make sure to regularly present the benefits and future potential of your partner program. For instance, a product manager might be hesitant to support a partnership if they believe it will compromise their team's autonomy. By understanding their perspective and demonstrating how the partnership can enhance their product roadmap, you can gain their support.

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Similarly, a sales team may be sceptical of a partnership if they fear it will cannibalise their existing business. By highlighting the potential for cross-selling opportunities and demonstrating how the partnership can expand their market reach, you can alleviate their concerns and encourage their collaboration. Internal advocates can also be instrumental in overcoming challenges that may arise during the partnership lifecycle. For example, if there are issues with integration or implementation, an internal advocate can help facilitate communication between the partnership team and relevant departments.

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Pro tips for:

Early Ecosystems: Involve relevant departments in the development and testing of your proof of concept. This will foster a sense of ownership and encourage collaboration among internal teams. Communicate the potential benefits of the partnership to internal stakeholders. 

Scale-ups and Mature Ecosystems: Acknowledge the contributions of internal teams in driving partnership success. This will boost morale, encourage continued engagement, and foster a positive partnership culture. You can also share best practices and lessons learned from successful partnerships with internal teams. This will help build capacity and ensure that the benefits of partnerships are maximised.

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